MUFG reports that the pause on attacks lasts until 6 April and only covers energy assets. It says this may prolong the conflict and keep pressure on oil supply if the Strait of Hormuz remains constrained.<\/p>\n
It reports that Iran allowed ten tankers to pass as a limited gesture. It says there is little indication of a broader reopening of traffic through the Strait of Hormuz in the near term.<\/p>\n
MUFG expects Brent crude oil to drift higher under these conditions. It flags a severe scenario where Brent trades in a USD 120\u2013160 per barrel range, alongside wider market risk-off moves and rising global recession concerns.<\/p>\n
In that severe scenario, MUFG states equity markets could fall further. It also states the DXY could move towards the 105 level, which it puts at +7%\u20138% versus the pre-conflict level.<\/p>\n
The article notes it was produced with the help of an Artificial Intelligence tool and reviewed by an editor.<\/p>\n
With the temporary pause on energy asset attacks ending on April 6th, we see growing pressure on oil supplies. The Strait of Hormuz, which normally sees about 21 million barrels of oil pass through it daily, remains severely constrained. Traders should consider buying near-term call options on Brent crude to capitalize on a potential price surge as this deadline approaches.<\/p>\n
The rising cost of oil is fueling fears of a global recession, creating a classic risk-off environment for the wider market. We saw the VIX volatility index spike significantly during similar geopolitical tensions in late 2025, suggesting a defensive posture is warranted. Purchasing put options on major equity indices like the S&P 500 could serve as a valuable hedge against a market downturn in the coming weeks.<\/p>\n
A flight to safety would also likely strengthen the US dollar, with a potential for the DXY to approach the 105 level. We remember the rush to the dollar during the regional banking stress in 2025, which serves as a recent model for this type of currency move. Long positions on the dollar through futures or call options present a clear opportunity if oil prices continue their ascent.<\/p>\n
Given the potential for a severe price spike to between $120 and $160 per barrel, option volatility has already increased. With implied volatility on crude options rising over 30% this past month, using spreads is a prudent strategy. A bull call spread, for instance, can reduce the high cost of entry while still offering exposure to the expected upward drift in oil prices.<\/p>\n
Create your live VT Markets account<\/a>\u00a0and\u00a0start trading<\/a>\u00a0now. <\/b><\/p>\n","protected":false},"excerpt":{"rendered":" MUFG says limited pause and ten-tanker passage won\u2019t ease Hormuz constraints; Brent could surge, markets risk-off.<\/p>\n","protected":false},"author":103,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[59],"tags":[],"class_list":["post-45749","post","type-post","status-publish","format-standard","hentry","category-live-updates"],"acf":{"acf_article_selection_author":null},"aioseo_notices":[],"aioseo_head":"\n\t\t\n\t\n\t\n\t\n\t\n\n\t\t